The Month in U Inventory: Spot Declines While LT Production Forecasts Face Headwinds

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Given the market correction in November, the spot uranium price ended the month -7.5% lower, settling at $76.00 per lb (Numerco). That said, the spot price range during the month was between $75.75-$79.50 per lb. The term price remained at the $86.00 per lb level. Of note was that over the past month, November contracting increased to 31.0M lbs, bringing the YTD figure to 74.9M lbs. The Sprott Physical Uranium Trust (U-U, U.UN) added 550,000 lbs of uranium inventory bringing its total to just over 74.0M lbs. The current inventory figure represents a notable 4.0x increase to the 18.3M lbs held just four years ago when the Trust was launched, post Uranium Participation Corp. acquisition. Meanwhile, Yellowcake PLC (YCA.LN) maintained its inventory level at just over 23.0M lbs.

In early November Cameco (CCJ, CCO) reported Q3/2025 results highlighted by adjusted EBITDA of $220M (from the uranium segment) which was lower that the $240M as reported from Q3/2024, largely due to lower volumes sold during this latest quarter. This was offset however by improvements in the average realized price in the quarter ($62.12 per lb) relative to Q3/2024. The quarter was mixed on the operational front as a production shortfall from McArthur River/Key Lake may be offset by up to 1.0M lbs from Cigar Lake (19M lbs, 100% basis) for FY/2025. From JV Inkai, FY/2025 production remains at the targeted 8.3M lbs (100% basis). During the quarter, Cameco produced 4.4M lbs of uranium (Cameco’s share) while also purchasing 1.4M lbs at an average of $60.13 per lb. Cameco’s share of FY/2025 production is expected to be up to 20M lbs.  Over the next five years, the company maintains delivery contracts for over 28M lbs U3O8 per year.  From Westinghouse amounted to $124M for the quarter, a slight increase from the same period ion Q3/2024. Elsewhere, Kazatomprom (KAP) reported its Q3/2025 results with attributable production totaling 8.78M lbs U3O8 representing an 8% increase from the prior period in 2024. Sales volumes during the quarter increased by a notable 33% to reach 13.39M lbs for the group, as the average realized price amounted to $68.79 per lb. Group sales volumes were maintained at 45.5M-48.1M for FY/2025 with both revenues and cash costs expected to be higher relative to estimates given at the start of the year. Longer term, production is likely to be constrained. Recall that production guidance for FY/2026 was previously cut given supply constraints and lower recovery rates at lower levels than those stipulated in the Subsoil Use Agreement. From Ur-Energy (URG), the ramp-up at Lost Creek continued as 93,523 lbs U3O8 were dried and packaged in Q3/2025 while with enCore Energy (EU), 227,000 lbs U3O8 was extracted from Alta Mesa. Energy Fuels (UUUU) managed to extract 465,000 lbs of U3O8 from its Pinyon Plain and La Sal mines.

Sprott Physical Uranium Trust (U.UN-T, U.U-T): 2-Yr Performance:

Over the month of November, the Trust’s uranium inventory went from 73.489M lbs to 74.039M lbs as the total number of units outstanding accordingly increased from 308.051M to 308.094M. The inventory figure represents a notable 4.0x increase to the 18.3M lbs held just four years ago when the Trust was launched, post Uranium Participation Corp. acquisition.

Valuation: Given current pricing and FX, SPUT's discount to NAV increased from last months discount of -0.2% to the current -2.7% discount with the Trust now trading at a 0.97x P/NAVPU relative to its intrinsic value of $25.68. Note that following a slight valuation premium in September 2023, the valuation discount has largely been maintained, apart from a brief period this past fall. The current -2.7% discount ranks well above the near -15.0% discount last seen in February 2023. Given our LT $80/lb price objective for the spot and a constant CAD/USD exchange rate, our 0.95x NAVPU valuation of $25.90 (rounded) per unit is being maintained. For further context, the current -2.7% discount to NAVPU is relative to +26% premium in September 2021 and -18.1% discount from July 2022. YTD shares in U.UN have advanced by +4.6%. For the time being, we are maintaining our $80 per lb LT uranium price deck. The corresponding sensitivities to FX and the spot price are below:

Yellow Cake PLC (YCA-L): 2-Yr Performance:

Valuation: Given the most recent spot U3O8 quote at $76.00 per lb (or £57.76 per lb), YCA is trading at 0.93x P/NAVPU, or at a -6.5% discount given the current 1.0x NAVPU intrinsic value of £559.47. Though Yellow Cake normally trades at a larger discount to intrinsic value relative to SPUT (justifiably reflecting the smaller size, liquidity and larger perceived delivery risk associated with Kazakh sourced uranium), we feel that the current relative discount to NAV is being heavily influenced between the ever-present Russia/US geopolitical unease reflecting uncertainty over future sanctions on possible uranium supply from Russia and availability from Kazakhstan. Given our LT $80/lb price objective for the spot and a constant GBP/USD foreign exchange rate, our 0.80x NAVPU valuation of £558 (rounded) is maintained. As per YTD performance, shares of the Yellow Cake have advanced by +0.6%. The corresponding sensitivities to FX and the spot price are below:

Recall that under the Kazatomprom Framework Agreement (KFA), Yellow Cake maintains the option to purchase up to $100M of U3O8 each year for a period of nine years, starting from the company's IPO in 2018. That said, it is our view that geo-politics will continue to weigh on Kazakh sourced uranium, and in general on all companies with exposure to Kazakhstan, (despite current transport routes which completely bypass Russia). Recall that as announced earlier this summer, Kazatomprom reduced its FY/2026 production guidance going from the initially estimated 85M lbs U3O8 (100%) to approximately 77M lbs (100%), the decline largely reflecting adjustments from the Budenovskoye production area. This guidance revision came amid the current environment in which construction and the procurement of the needed production materials (notably sufficient levels of sulfuric acid) remains challenging. In the latest quarterly filing, Kazatomprom indicated that revenues specifically from China now account for 60% of the total.